1. US jobs data sets bullish tone for Fed rate hike
An October US jobs report that far exceeded all forecasts has raised the odds for the Federal Reserve to make its first interest rate rise in nearly a decade at its last meeting this year.
Indeed, the chance for a hike at the Fed's Dec 15-16 meeting rose to 70 per cent on Friday (Nov 6) after the jobs report came out, from 56 per cent on Thursday, according to the fed funds futures market.
The report not only revealed more hiring than even the most optimistic of 101 forecasters polled by Reuters, but also that the US unemployment rate fell to 5 per cent and average pay growth accelerated to a solid 2.5 per cent annual pace.
A slew of Fed officials speak this week, which could give more confidence on the prospects for a December rate rise. Boston Fed president Eric Rosengren is to discuss the US economic outlook early on Tuesday, Singapore time, while St Louis Fed President James Bullard, Richmond Fed chief Jeffrey Lacker, Chicago Fed boss Charles Evans, and the New York Fed's William Dudley will feature on the following days. Fed chief Janet Yellen gives opening remarks at an event on Thursday.
Markets will also eye US retail sales data due on Friday to gauge the strength of the American consumer. Retail sales are expected to have increased 0.3 per cent last month, following a 0.1 per cent advance in September, according to a Reuters poll. That is a sign of positive momentum heading towards the biggest shopping day of the year, Black Friday, on Nov 27, and Christmas.
2. Weak China trade adds to pressure for more stimulus
Exports helped stoke China's rapid-growth phase, a period that now seems over as the global economy slows down. A report on Sunday (Nov 6) showed China exports fell 6.9 per cent in October in dollar terms, a bigger decline than estimated by all 31 economists in a Bloomberg survey.
Weaker demand for coal, iron and other commodities from declining heavy industries sent imports plunging 18.8 per cent.
Wednesday will see more key October data releases. Industrial production and fixed-asset investment are expected to show little pickup, even after six central bank interest-rate cuts and moves to spur local government spending. The silver lining: Retail sales gains are seen underscoring the rising role of consumers. But this will not make up for the decline in manufacturing and exports.
As such, the pressure will likely mount this week for more stimulus by Beijing.
3. Single's Day in China
Speaking of the Chinese consumer, Wednesday is Single's Day in China, the biggest shopping event in the country and the biggest sales day for ecommerce giant Alibaba. The total volume of merchandise bought through Alibaba during the annual shopping extravaganza last year came to a whopping 57.1 billion yuan (S$13.2 billion) - up 58 per cent from the previous year.
4. Euro zone GDP in focus
Growth data for the euro zone due on Friday are expected to be decent, but not spectacular. Economists polled by Reuters expect quarter-on-quarter growth of 0.4 per cent for the July-September period, steady on the prior quarter. But growth in Germany, Europe's biggest economy, probably slowed to 0.3 per cent last quarter from 0.4 per cent in April-June, and it is far from clear whether that momentum can be sustained or speeded up in the current quarter.
There will be plenty of comments from ECB officials this week, likely to be both for and against more stimulus.
Other euro zone data to note: industrial production due on Thursday and trade balance on Friday.
5. Flurry of Singapore corporate results
A quiet data week for Singapore with just September retail sales due on Friday and SRX Property's price indices for HDB and private non-landed housing on Wednesday and its rental indices on Thursday.
But many big companies will be filing their quarterly results this week including Wilmar on Wednesday; City Developments, SingTel, Genting Singapore and Golden Agri-Resources on Thursday; and Olam and Comfortdelgro on Friday.
Sources: Reuters, Bloomberg, Financial Times
